The Bankrate promise
At Bankrate we strive to help you make smarter financial decisions. While we adhere to strict , this post may contain references to products from our partners. Here's an explanation for .
Shopping in some cities can cost you big — in sales tax, that is. In some places, you’ll pay as much as an extra 10 percent at the register due to combined state, county and local sales taxes.
Expect sales tax rates to increase: Collecting this tax means big bucks, and it’s sometimes the fastest way to balance ailing state and local government budgets. According to a U.S. Government Accountability Office report, sales taxes generated about $450 billion in 2008 — more than property taxes ($411 billion) and personal income taxes ($310 billion).
Highest sales tax rates
It’s helpful to know the locations of the highest tax sales rates in the country, particularly if you want to move or you’re planning a vacation.
A recent report issued by the Tax Foundation, a nonpartisan educational organization, ranked U.S. cities with populations of more than 200,000 by tax rates. These cities rank highest when accounting for state, county and city sales tax rates combined:
- Tied for first place are two cities in Alabama: Birmingham and Montgomery. Be prepared to dish out not only 4 percent in state sales tax, but also an additional 3.5 percent to 4 percent in city sales tax, and another 2 percent to 2.5 percent in county tax, for a whopping estimated 10 percent total.
- The next four top cities are in California: Long Beach, Los Angeles, Oakland and Fremont. The state sales tax levied in California is a flat 7.25 percent; but with various permutations of county and city taxes, all four cities have a total of 9.75 percent sales tax.
Other cities with combined state, county and city tax rates of more than 9 percent include:
- Glendale, Ariz.
- San Francisco.
- St. Louis.
- Memphis, Tenn.
- Nashville, Tenn.
- San Jose, Calif.
- Tuscon, Ariz.
- Mesa, Ariz.
- Scottsdale, Ariz.
Check sales tax rates in your state.